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Water scarcity, aging infrastructure, climate volatility, water quality issues and rising water-related energy risks are increasing the need for action in the US water sector, an Ernst & Young Global Cleantech Center whitepaper says.

Additionally, decaying infrastructure and the related funding gap remain unresolved. Hopes for the US water sector to produce “blue-gold”-like investment returns are damped by market structure growth constraints and major barriers to entry for innovators, according to the report.

Develop the data and transparency practices needed to establish consistent, comprehensive pricing models that reflect the true economic value of water to attract investment and promote a better balance of interests among users.

Improve quantitative management by establishing common terminology standards and comparable metrics for water disclosure and footprinting.

Consider the opportunity to bring new capital, dynamism and efficiencies to the water sector through private equity-driven consolidation.

Spur the development of public-private and public-public partnerships to help close the water funding gap by bringing globally established best practices to the US market.

Strengthen the water innovation ecosystem by establishing industry frameworks for assessing and adopting new technologies.

Open up conservative utility bidding procedures and update building codes to allow for procurement of efficient cutting-edge equipment and technologies.

Encourage innovation and competition in serving water systems by providing incentives for consultant rotation, independent advice and transparent bidding processes.

Expand the decoupling of regulated utility revenues from water consumption to enable investments in conservation and efficiency, especially in water-stressed regions.

Consider more closely long-term capital expenditure needs and water source availability, as well as the traditional financial indicators, in the formulation of water utility bond ratings.

Convene the various institutions with oversight on water to set a coherent national water agenda, one that includes efficiency goals, upon which updated regulations and implementation mechanisms would be based.